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Collapse of the European Union
The collapse of the European Union occurred on September 17th 2025, officially re-granting economic and political control to it's former member states. The dissolution was made official in a meeting in Brussels, attended by the heads of its remaining member states. With the chairs of Greece, Italy and Spain left symbolically empty, the European Union unanimously voted to disband, whilst re-establishing the European Economic Community (EEC). Background The European Union (EU) was an economic union comprising at its peak membership 28 countries in Western and Southern Europe, as well as Scandinavia and the Mediterranean. Based on the European Economic Community, which was founded in 1957, the EU came into being with the signing of the Maastricht Treaty in 1992, under which a common currency, the Euro was created. Most member states gave up their national currencies in favor of the Euro, but while it was legal tender in Great Britain, they retained the pound. The EU was governed centrally by an elected central parliament of 751 elected Members of the European Parliament (MEPs) drawn from its member-nations, who often faced strong nationalist opposition at home from those against surrendering any local governmental power to a central, federalist body. Great Britain would be the first nation to leave the EU following a referendum on June 23rd 2016 in which 51.9 per cent of those voting supported leaving the EU. The invocation of Article 50 of the Treaty on European Union started a two-year process to prepare for the departure, which concluded with the UK's exit on June 23rd 2019. Financial Woes With many of the member states still struggling with the after-effects of the "Great Recession" of 2008 - 2018, and with the cash reserves of the European Central Bank (ECB) running low, in January 2020 Greece failed to secure a 4th round of bailout funding from the ECB. Following 3 months of civil unrest, the Greek Government announced that they were defaulting on the debt, leaving the EU and restoring the Drachma as the official currency. The shock waves that this sent through the Eurozone would result in the announcement of Italy and Spain's departure by August and October respectively. The Rise of Inflation; The Rise of Extremist Politics By mid-2021 the European economy was in a state of freefall. Inflation was rising rapidly in the countries that had had to give up the Euro as their currency, and government terms in Greece, Spain and Italy were typically short; Italy held 3 general elections in 2022 alone. Extremist politics were on the rise, and rival parties clashed in the streets of Greece and Spain. In the years that followed, the member states with smaller economies (Poland, Romania, Hungary and Ireland) would have no choice but to default on their debts to the ECB, and exit the Eurozone one after another. Rebirth of the European Economic Community and near collapse of the Central Bank On the 14th of March 2025, fearing the effects of the by now inevitable collapse of the ECB on their own failing economies, the economic powerhouses of the European Union, France and Germany announced their own withdrawal from the EU to reestablish the European Economic Union (EEC). This plan would effectively wind-back the state of the Union to that of the early days of the EU, whilst protecting the Euro as many smaller European states still used it (especially in newly admitted states) Despite this, the value of the Euro crashed, losing 16% of its value over the course of a single day of trading, closing the day at a value of $0.70, but recovered to $0.85 the following day. The ECB would be overhauled and reestablished as the Bank of Europe. Dissolution With substantial quantities of Europe's wealth wiped out, and with global economic commentators saying that it was surely only a matter of time, 6 weeks later on April 28th 2025, the Maastricht Treaty, signed of 1993, formally dissolved the union. The Treaty of Rome 1957 would be amended extensively reflecting the new European relationship and renamed the Treaty of Brussels 2025. Aftermath Whilst the Euro and a European Community was still intact, it's reputation had been destroyed. The Euro would never reach parity with the U.S. dollar until the Syndicate Cold War. Russia had begun to bail out former EU members under the agreement they support Russia politically. This arrangement first was implemented in the Warsaw Purchase between Russia and Poland and the the Trans-European Treaty. Subsequent deals with other nations, both within and outside of Europe, would eventually see the creation of the Common Defence Pact (CDP). Prominent EU members France, Germany, Belgium, Netherlands and Luxembourg began drafting up plans to create a "EU 2.0" learning from the issues felt with the first EU. All the while, they encourage former EU members to join the new EEC, more and more nations were joining Russia's Trans-European Treaty, including Germany (which prompted their expulsion form the EEC). When the CDP was proclaimed, Germany returned and enacted EU 2.0 with France. The new entity would become known as the European Federation.